Frank Rzeznikiewicz

1. This Year’s Production Challenge
The year has begun. There are several things to be considered when setting your
strategic plan in place for the new year. What corrections did you need to make in
the last quarter to bring in the previous year as a success. Did those corrections
simply accommodate your metrics or did they change the business for the better? A
simple example is waste control. At the end of the year, did you not scrap out
hardware that you should have dispositioned to attain a cost of poor quality or
financial number? Were you balancing your scrap rate against an inventory goal
and abandoning better business practices to hit a metric? Did you push high dollar
products in front of lower revenue ones that your customer desperately needed? All
of these practices are a fault of your prior year’s execution of the strategic plan. The
problem with the aforementioned is that you are probably having a very tough first
quarter. With that being said, you must analyze what did not execute properly that
you have to adjust in the upcoming year.
1. Were your goals too aggressive and based off a desire or ones that had a
sound detailed plan that was executional? Many times we set our goals off a
desire and not as a strategic plan for improvement. If you look at your
projected sales for this year, have you detailed the inventory you will need to
attain the increased sales goal? Drill down the data to assure that your year-
end projections are based off a carrying inventory that will be required for
success. Failure to do so will result in a starved inventory for production in
the first month of 2017. Assure that material planning is accurate and that
you realize the inventory you need for 2016 is in place that does not deficit
the beginning of 2017. Realize that in the last quarter of 2016 you must
execute your material properly and not delay material receipts again.
Detailed and verified inventory plans are required for each year’s success.
2. Waste planning is essential to success. Whether it be productivity, effectively
or scrap and rework levels, your strategic plan now has to be compared to
what was executed in 2015. When you set your goals for 2016, you must ask
whether they were too aggressive or too lax. Did the goals for scrap
materialize or did you hold back execution burdening the upcoming year? If
you let your business run and execute to normal practices at the end of the
year, congratulations as you did not manage the business to metric
attainment. Observe those practices that were successful and which ones
required intervention. Determine what the product flow actualizes and
understand that unless you have a level three plan that is aggressive for
improvement, your goal cannot be aggressive for attainment. A detailed plan
for improvement is necessary for any step change and that plan must be
reviewed with the responsible managers and the executors of that
improvement plan.

2. 3. Plan your sales plan off customer demands. You cannot be overly optimistic
in creating the annual operations plan. Base that plan and make adjustments
off of the market indicators for the industry you are in, firm contracts that
are in place, spares sales that are based off of previous years realizations and
firm forecasts, and reasonably project any new product introductions. Being
overly optimistic will realize a plan that fails and one that is too conservative
will starve your business of resources.
4. Develop a production start plan. At the onset of the year, you will be able to
project production starts and build in outsourcing and shared resources. You
can also deliver a plan that executes the entire year. That plan will require a
review and adjustments throughout the year, but you will be able to project
resource and material shortages and the risks associated with them. You
must finalize your start plan months in advance to set the demand for
material, manpower and process capacities. The failure of many production
systems is the inability to project a starts plan and executing it appropriately.
5. Review your plans with all levels of the organization. Include the quality,
materials, planning, procurement, and production groups. If possible review
that plan with the hourly associates that produce the product. They will
either validate the plan and attempt to perform to it or they will point out
shortages that you may not have realized. Communicate the entire
production plan so that everyone in the organization understands where
improvements must be made and when resources will be strained.
Make 2016 a business based off sound date and not from opinions or
speculations. The success to you year is based off a strategic plan that executes
and is measured so short term adjustments may be made accordingly.